Gareth Hutchens, Lisa Cox

Professor Ross Garnaut: "If either the government or the Palmer United Party had another thought then we may still retain the infrastructure and so be in a better position to go forward." Photo: Andrew Meares

Economist Ross Garnaut has asked the Abbott government to consider an alternative policy for emissions trading in a bid to save the country's climate change infrastructure.

Speaking at a conference in Melbourne on Friday, Professor Garnaut said Australia's climate change infrastructure was facing an uncertain future as the Senate looked likely to support the government's repeal of the carbon price while opposing its direct action policy.

The author of the Garnaut Climate Change Review asked Federal Environment Minister Greg Hunt on Friday to consider moving to a flexible carbon price of 40 cents until other major economies develop their own schemes.

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Professor Garnaut said his suggestion accounts for the role played in the new Senate by the Palmer United Party.

His comments comes a week after Clive Palmer announced his party would support the government's bill to abolish the carbon tax, however his senators would not allow the scrapping of the Clean Energy Finance Corporation, the Climate Change Authority or any changes to the renewable energy target before the next election.

Mr Palmer said his senators would also move an amendment that would see Australia move to a zero rated emissions trading scheme until major trading partners take similar action.The Palmer United Party leader has not outlined details of what this amendment will look like when it is put to the Senate.

"[I suggest] we make one change to this arrangement that is different to any of the [major] parties," Professor Garnaut told the Australian-Melbourne Institute conference.

"We [should] retain the infrastructure of the emissions trading scheme ... and move back to an emissions trading scheme with a flexible price and remove the limit on clean development mechanism (CDM) credits in [that] scheme.''

Clean development mechanism credits are credits purchased from developing countries.

At the moment, there is a limit of 12.5 per cent of liabilities that can be met through use of international CDM credits, he said, but they are currently in oversupply, available at about 40 cents.

"So [my policy] would mean a carbon price would fall to 40 cents and alongside the removal of the limits on the credits, I would suggest that we restore the limits when the conditions set down by the Palmer United Party are met, that is, when China, the US, Korea, Japan and Europe are making efforts comparable to the effort Australia would be making after the restoration of the limits on the CDM," Mr Garnaut said.

However, Mr Hunt dismissed the suggestion, saying the Abbott government's bill to get rid of the carbon tax was before the Senate, ''and the bill is for abolishment''.''We have the bills before the Senate, which are due to go before the Senate early next week, and it is an abolition,'' Mr Hunt said.

Mr Hunt said he respected Professor Garnaut's views but he did not believe there would be a gap in Australia's climate change policies when the carbon tax is abolished.

"We have the carbon farming legislation which is ... ready to go before the Senate," Mr Hunt said.

"And the infrastructure that we are retaining is the carbon farming initiative, the greenhouse and energy reporting scheme, and [the] clean energy regulator.

"And the emissions reduction fund actually uses, and was always designed to use, the existing infrastructure, and we will use that for buybacks."

But Professor Garnaut said he would like the major parties to at least consider his proposal.

''If either the government or the Palmer United Party had another thought then we may still retain the infrastructure and so be in a better position to go forward when the conditions are right for it.''